Saturday, April 21, 2012

Nothing Succeeds Like Failure

Some bills offered by politicians in campaign modes are difficult to pass but worth supporting as campaign puffers. They look good, in other words, on a campaign resume: “Democratic contender for the U.S. Senate Leon Trotsky, a proletarian himself whose grandmother worked her fingers to the bone in a soul grinding mill – for slave wages, we may add -- has always favored periotic increases in the minimum wage, while Republicans, mostly grasping yacht owners, have always fancied keeping the poor on the edge of poverty.”

A bill that favors one or another preferred special interest and yet fails to pass in the legislature is not a failure -- provided it may afterwards be molded into campaign bullets and shot at political opponents.And failed bills that entail disastrous consequences are problem free when they fail, because failure decouples crippling consequences from legislation.

There are sound reasons for believing that minimum wage bills hurt the poor and affect large scale business operations not at all.

Too-big-to-fail businesses in Connecticut, some of which have already benefited through Governor Dannel Malloy’s “First Five” program, already pay salaries in excess of the minimum wage proposed this year by Speaker of the House Chris Donovan. Mr. Donovan’s bill, which raises the minimum wage in Connecticut by $1.50 over two years, will only affect companies that pay their employees a minimum wage. In some cases, the wage mandate will force employers who cannot meet the demands imposed on them by Mr. Donovan to resort to unwanted measures. Unable to afford the artificial increase in the price of labor, some employers will either increase prices to recover a loss in profit margins necessary to sustain their business, or reduce the net cost labor by letting some employees go, depending upon those who have not been laid off to take up the slack. Business hours may be cut back; expansion plans may be curtailed; profits that might have been used as seed corn for future growth will be diverted to other ends; some owners of companies may decide to pack it in and more out of state; others may hobble with a broken foot into the future until such time as they are bought out by large chain stores that can afford to pay government mandated salary increases. These are some of the consequences, none of them propitious, that might be aborted were Mr. Donovan’s bill to fail in the General Assembly.

When the Speaker of the Senate Don Williams was asked by a reporter whether Mr. Donovan’s signature bill raising the minimum wage might pass in his chamber, Mr. Williams sniffed that he had polled his caucus and the members “have a lot of questions." Even some House Democrats were cool to Mr. Donovan’s bill, as was Mr. Malloy. The Democratic dominated General Assembly had just passed a first in the nation law mandating that businesses in the state offer paid sick leave to their employees, a bill that will not affect the bottom line of large in-state businesses that already offer paid sick leave. Would Mr. Donovan’s new bill be the straw that breaks the back of business that in the past have hired new workers, helpfully placing their feet on the bottom rungs of a ladder of success the General Assembly likely would remove though Mr. Donovan’s bill?

Confronted with recent news that faltering income tax revenues have punched a $142 million dollar hole in Governor Dannel Malloy’sbudget, General Assembly Democrats may be indisposed to pass Mr. Donovan’s small business punishing bill.

Mr. Donovan, however, was of good cheer. The Speaker’s comic Panglossian optimism in the face of a lingering national recession -- the most severe, many Democrats stress, since the Great Depression – has not often been restrained by the sharp pricks of reality.

“It's always been a good bill to run on at election time,” said the ebullient 5th District Democratic contender for the U.S. House.“That makes it good timing. And for the people who would benefit from the minimum wage, it's good timing for them, too," sort of a win, win bill that would, merely as an unintended benefit, help Mr. Donovan to win a coveted seat in the U.S. Congress.

Even if the Donovan bill fails, the effort will show well on his campaign resume.